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Healthcare Innovations is evaluating two potential projects, Project MedTech and Project BioHealth. The expected net cash flows are: Year Project MedTech Project BioHealth 0 $(500)

Healthcare Innovations is evaluating two potential projects, Project MedTech and Project BioHealth. The expected net cash flows are:

Year

Project MedTech

Project BioHealth

0

$(500)

$(450)

1

150

120

2

180

150

3

210

180

4

240

200

The required rate of return is 11%. You need to determine:

a. The payback period for each project. b. The NPV for both projects. c. The IRR for each project. d. Which project should be selected based on NPV and IRR? e. What are the strategic benefits of each project?

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